DOJ Launches New Civil Cyber-Fraud Initiative–Implications for False Claims Act
The Department of Justice (DOJ) recently announced the launch of the department’s new Civil Cyber-Fraud Initiative, which is intended to “combine the department’s expertise in civil fraud enforcement, government procurement and cybersecurity to combat new and emerging cyber threats to the security of sensitive information and critical systems.”
Led by the Commercial Litigation Branch of the DOJ’s Civil Division, the brand-new initiative “will utilize the False Claims Act to pursue cybersecurity related fraud by government contractors and grant recipients.”
A New Initiative for an Old Law
While the Civil Cyber-Fraud Initiative is the new kid on the block in the DOJ, its legislative toolkit is tried and true. As the Initiative’s primary enforcement tool, the False Claims Act (FCA) uniquely combines government enforcement with whistleblower insight.
Under its whistleblower provisions, the FCA allows private citizens to assist the government in identifying and eliminating fraudulent conduct. For example, here at Price Armstrong, we regularly represent whistleblowers in civil fraud investigations under the FCA.
In addition to offering protection from retaliation, the FCA provides whistleblowers with a share of the damages recovered from the fraudster, generally between 15% and 30%.
The DOJ identified three types of allegations that the Initiative will pursue against federal contractors or grant recipients under the FCA: (1) knowingly providing deficient cybersecurity products or services; (2) knowingly misrepresenting their cybersecurity practices or protocols; or (3) knowingly violating obligations to monitor and report cybersecurity incidents and breaches.
As Assistant Attorney General Brian M. Boynton remarked soon after the launch, the Initiative, at bottom, “will hold accountable entities or individuals that put U.S. information or systems at risk.”
A New Frontier for Fraud Prevention?
The DOJ’s Civil Cyber-Fraud Initiative stands ready to revitalize the FCA to take on threats at the forefront of existing and emerging technologies. In doing so, the Initiative will not only reimburse the government and taxpayers for losses incurred when companies fail to satisfy their cybersecurity obligations but will also help to improve cybersecurity practices nationwide.
At Price Armstrong, we have extensive experience litigating whistleblower civil fraud cases under the FCA. We also believe that the DOJ’s commitment to stamping out cyber-fraud through its new Civil Cyber-Fraud Initiative will create new ways for whistleblowers to bring successful claims under the FCA.
If you know of potential cyber-related fraud, waste, abuse and mismanagement, you may have a claim as a whistleblower under the FCA. At Price Armstrong, we make it our mission to protect whistleblowers every step of the way and to maximize their recovery. Contact us today for a free initial consultation and review of your case.